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I think avoiding smart people starting competitors by keeping them employed with high comps might be a good strategy for some of these cash rich and profitable companies. They might have been thinking of this as a good insurance.

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It's good strategy for the company, but bad for society*. I regard this as an example of market failure, where productive folk (who presumably want to do things that are cool and noteworthy) are diverted into sinecures to limit corporate competitors. The market for talent is being cornered here, just as a commodity trader might seek to corner the market to drive prices upward (or occasionally downward, to the detriment of a weak competitor).

This seems like a prima facie case for regulatory intervention to require divestment or breakup.

* I know, I know, 'how can we say it's bad, what if the resultant competition created environmental destruction or led to the invention of a basilisk.'

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